In Moody's reckoning, GE is no longer tops

General Electric (GE) lost its top credit rating from Moody's Investor Service on Monday over concerns about the health of GE Capital, its financial unit.

Moody's knocked GE's rating down two notches, from "Aaa" to "Aa2." The credit agency said GE's industrial units, which make everything from nuclear reactors to light bulbs to jet engines, is strong enough to deserve the highest marks for its debt. But risks on GE Capital's $637 billion balance sheet don't warrant a top rating, it said.

Standard & Poors slashed GE's debt one level, from "AAA" to "AA+," earlier this month. The cuts will raise the price GE must pay to borrow money.

"This action was not unexpected in the current environment, and while no one likes a downgrade, Moody's, like S&P, confirmed the fundamental soundness of GE Capital and the strength our industrial businesses," GE Chairman and CEO Jeff Immeltsaid in a statement.

GE held a conference for investors last week in an attempt to reassure them of GE Capital's ability to withstand the recession. Once responsible for a hefty chunk of the conglomerate's profit, the finance business may just break even this year, the company projected.

GE Capital holds billions of dollars in loans for real estate and commercial equipment, and investors are wary that borrowers may not be able to keep up with payments in the economic downturn.

Those forcasts seem optimistic to some analysts, who believe GE isn't being pessimistic enough about how bad the economy could get.